Partner Caroline Casagranda, in our leading Wills, Probate, Tax & Trusts team, explains what do do when a loved one dies and the legal advice you may require.
There are many things to arrange when a loved one dies and it can be hard to make important arrangements and decisions at a time when you may be feeling shocked and confused.
As well as dealing with the legal aspects we can also help with practical matters such as clearing a property of personal and household effects and dealing with the insurance and utility suppliers.
A Personal Representative is the person who deals with the administration of the estate. Who this person is depends on the following:
- If there is a valid Will it should include details of the person(s) the deceased wanted to act as executors of their Will.
- If there is no Will, the estate will be administered in accordance with the rules of intestacy.
- The rules of intestacy provide a ‘legal order’ of persons who can act as Personal Representatives in descending priority e.g. a) the surviving spouse or civil partner b) the children of the deceased c) the deceased’s parents.
Grants of Representation
Unless the estate is very small and has no freehold or leasehold property (such as a house or flat) the Personal Representatives will have to obtain a Grant of Representation from the Probate Registry showing their entitlement to deal with the estate. We will be able to tell you if a Grant is needed, and can handle all the necessary paperwork for you if you wish.
If the deceased left a Will, then an application is made to the Probate Registry for a Grant of Probate; if the deceased did not make a Will and therefore died “intestate”, the Personal Representatives have to apply for a Grant of Letters of Administration.
If a Will was left, this will explain who is to inherit the estate. If there was no Will, the law sets out who is entitled to inherit, and we will be able to tell you which members of the family are entitled to the estate and in what proportions.
The first stage of our work is to prepare the papers to apply for the Grant. Before applying for the Grant, we will have to provide a detailed valuation of all of the deceased’s assets and liabilities at the date of death.
There is a checklist below that includes suggestions about property which the deceased may have owned and bills which may be due to be paid which may not otherwise immediately come to mind.
We would also arrange for payment of all the liabilities, including the funeral account, and other bills. Once this has been done we will write to all of the beneficiaries to inform them of their legacies.
Assets & Liabilities Checklist
- Freehold/Leasehold Property
- Bank and Building Society Accounts
- National Savings Investments – Premium Bonds, Income Bonds, Savings
- Certificates, Pensioner Bonds
- Life Insurance Policies
- Stock Exchange Investments - shares,
- PEP’s, ISAs, Treasury Stock
- Pensions - state and occupational
- Car, Jewellery, Antiques, other valuable personal effects
- Household Utility bills - electricity, gas, telephone, water, council tax, TV rental/licence
- Home insurance
- Funeral / Memorial Account
- Credit Cards or bank loans
- Medical or Residential Care Home/Nursing Home bills
We can advise you in relation to the Inheritance Tax (IHT) aspects of the estate and, if there is IHT to pay, we can discuss the various ways in which it can be paid. On current figures, no tax is payable on the first £325,000 of the net estate.
Thereafter IHT is payable at the rate of 40%. There is no tax at all, whatever the value of the estate, on property going to a widow or widower or to a charity. The value of this exempt property is deducted from the value of the whole estate before the tax calculation is done. In this way, gifts to husbands, wives and charities can take an estate out of the tax bracket.
If there is likely to be an amount of IHT to pay, we can prepare the relevant Inheritance Tax forms to be submitted to HM Revenue & Customs before applying for the Grant.
Administration of the Estate
Once the Grant has been obtained, we will register the Grant with banks, building societies and other institutions holding the deceased’s assets.
Some items may need to be sold and we will discuss this with you. Larger and more valuable items may have to be professionally valued for IHT purposes, and fees for this and other work for the estate will be paid from money in the estate.
The final stages of our work involve obtaining confirmation from HM Revenue & Customs that the deceased’s Income Tax position and, if appropriate, Inheritance Tax position, has been finalised. We will then pay out the remaining entitlements to the beneficiaries and complete a set of Estate Accounts covering the administration period for your formal approval.
If appropriate, we may also be involved in setting up any trusts which arise under the Will or on the intestacy. If appropriate we can refer beneficiaries to independent financial advisers to discuss whether and how they would like to invest their inheritance. We can also advise beneficiaries on IHT issues.
For further information or legal advice, please contact firstname.lastname@example.org or call 0118 951 6800.
This article is intended for the use of clients and other interested parties. The information contained in it is believed to be correct at the date of publication, but it is necessarily of a brief and general nature and should not be relied upon as a substitute for specific professional advice.